The following infos pertains to the production department of ABC Corp *Indirect Salaries includes the salary of manager budgeted at 28,000 with actual cost of 35,000. REQUIREMENTS: 1. Compute for the Actual Non-Controllable Cost. 2. Assume that the top-level management is evaluating the performance of its production manager. Compute for total cost variance where the manager should be evaluated (favorable)/unfavorable

The following infos pertains to the production department of ABC Corp *Indirect Salaries includes the salary of manager budgeted at 28,000 with actual cost of 35,000. REQUIREMENTS: 1. Compute for the Actual Non-Controllable Cost. 2. Assume that the top-level management is evaluating the performance of its production manager. Compute for total cost variance where the manager should be evaluated (favorable)/unfavorable

FINANCIAL ACCOUNTING

10th Edition

ISBN:9781259964947

Author:Libby

Publisher:Libby

Chapter1: Financial Statements And Business Decisions

Section: Chapter Questions

Problem 1Q

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1. In 2020 standard cost variance analysis report presented by the controller of ABC Corporation, the labor cost variance shows that efficiency has resulted to favorable variance, while rate shows unfavorable variance. Which of the following could have been the reason for the said outcome? a) The workers assigned in the production department were experienced and skilled individuals and relatively high paid b) The workers assigned by the human resources management were unskilled and relatively low paid c)The workers were pushed to over time due to inefficiency in making the product. d) Low quality materials were used and caused more labor hours to be produced 2. Which of the following would result to a favorable volume variance? a)There is a favorable spending variance b)Production is equal to sales c)There is a favorable efficiency variance d)Production is greater than budgeted 3. Which of the following…
Why is the identification of favorable and unfavorable variances so important to a company? How can the identification of the variances help management control costs? Please explain. As you are considering the flexible budgeting topic of the week, it is important for you to look at this analysis as a significant contribution to the management of the company. Knowing what the bottom line profit or loss is important. But what is more important is to understand how your actual results varied in terms of units sold versus how the actual cost of each unit differed from the budget.
Compute for variable overhead efficiency variance.
I have attached the data information for the problem I need help with Part D of the problem. Further analyze harlows revised variances, isolating underlying potential casual factors. How do your analyses indicate bases for concern to management?
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Jordan Manufacturing Company established the following standard price and cost data. Sales price $ 8.50 per unit Variable manufacturing cost $ 3.60 per unit Fixed manufacturing cost $ 2,300 total Fixed selling and administrative cost $ 700 total Jordan planned to produce and sell 2,500 units. Actual production and sales amounted to 2,700 units. Required Determine the sales and variable cost volume variances. Classify the variances as favorable (F) or unfavorable (U). Determine the amount of fixed cost that will appear in the flexible budget. Determine the fixed cost per unit based on planned activity and the fixed cost per unit based on actual activity.
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Sunshine Goods Ltd is a revenue maximizing firm that engages in the analysis of variances to provide useful information to management. The company manufactures and sells three (3) products, RG, KC and MG. During July 2019 the following budgeted and actual results were presented to you the management accountant for analysis: Budgeted Results Product Total Sales $ Volume/units Price $ Contribution margin per unit $ Total contribution margin $ RG 585,000 900 650 820 738,000 KC 500,000 500 1,000 850 425,000 MG 300,000 600 500 720 432,000 Total 2,000 1,595,000 Actual Results Product Total Sales $ Volume/units Price $ Contribution margin per unit $ Total contribution margin $ RG 500,000 500 1,000 800 400,000 KC 270,000 300 900 `900 270,000 MG 105,000 350 300 700 245,000 Total 1,150 915,000 Required: Sales margin quantity…
The following information is available for a manufacturer. Compute the direct labor rate and efficiency variances and label them as favorable (F) or unfavorable (U). Actual direct labor cost (6,250 hours @ $13.10 per hour) $81,875 Standard direct labor hours per unit . 2.0 hours Standard direct labor rate per hour $13.00 Actual production (units) . 2,500 units Budgeted production (units) . 3,000 units